NatureWorks still stuck in discussions with junta over Thai PLA plant project

THAILAND – NatureWorks’s plans for a PLA (polylactic acid) plant in Thailand are still on hold, as the US bioplastics company continues discussing the possibility of receiving investment incentives with the new junta government.

In 2013, NatureWorks – a 50:50 joint venture between Cargill Inc and Thai petrochemical giant PTT Global Chemical Plc – opened its Asia Pacific headquarters in Bangkok and announced plans to build its second Ingeo-branded PLA production facility, to be located in Rayong.

However, renewed political turmoil which started in November 2013 adversely impacted on discussions with the previous Thai government, and during an interview with PackWebasia.com in February 2014, NatureWorks president and CEO Marc Verbruggen said, “It is very unfortunate that the political climate in Thailand has been so difficult now for a number of months. And that is now putting a lot of things on hold, including our discussions with the Thai government on project financing. We have tentatively selected a site, but that is not doing us any good. So we really hope that all these issues get resolved, that there is a Thai government in place that we can talk to.”

The military takeover in May restored some form of order in Thailand, and on 25 August, the Thai King endorsed Prayuth Chan-Ocha – the army chief which toppled the previous government in the coup – as the country’s new prime minister.

According to Steve Davies, Director of Public Affairs & Communications at NatureWorks, talks with the Thai Finance Ministry have been ongoing “and continue, with the Federation of Thai Industries involved as they represent a broad industry base which includes a variety of parties that could benefit from the soft loan proposal in discussion.”

Davies said, “While we’ve made it clear that Thailand is a preferred location for our second Ingeo facility, we have not yet finalized our investment location.

“The ongoing discussions with Thailand’s Finance Ministry have been around the possibility of project financing as one incentive.”

While he declined to specifically comment on other possible sites that NatureWorks may consider in the event that discussions with the Thai junta government fall through, Davies noted, “The key point here is that other Southeast Asian countries offer very aggressive tax, feedstock and energy incentives for bio-polymer investments.”

Davies also assured that despite the delays plaguing the second Ingeo facility project, NatureWorks is “comfortable that we can satisfy the steadily expanding market demand (for PLA), given the expansion of our Blair facility from 140,000 to 150,000 ton/year.”

“Our commitment to Asia and support of investment to accelerate regional market growth remains unchanged,” stressed Davies. “With a physical footprint now established in Thailand, NatureWorks is better able to support the growth of its existing customers in northern Asia and develop new business in Southeast Asia. “